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State Name: New Jersey
State Name underscore: New_Jersey
State Name dash: New-Jersey
State Name lower underscore: new_jersey
State Name lower dash: new-jersey
State Name lower: new jersey
State Abbreviation: NJ
State Abbreviation Lower: nj

MND NewsWire features plain and simple interpretations of industry related data and events written in a manner that maintains the interest of random readers while still catering to the perspective of a housing market professional.

It appears that one of the nation's largest and most
troubled housing markets is getting back to normal. According to data released by DataQuick, Notices
of Default (NoDs), the first step in the foreclosure process, on California
houses and condos fell 22.1 percent in the fourth quarter of 2012 compared to
the third quarter and were down almost 38 percent from the fourth quarter of
2011. California
homeowners were a median of eight months behind on their payments when the
lender filed the Notice of Default and owed a median $14,364 on a median
$308,885 mortgage.

The 38,212 NoDs
recorded in the quarter was the lowest since the fourth quarter of 2006, near
the beginning of the foreclosure crisis.
Quarterly filings in the state peaked in the first quarter of 2009 at
135,431.

DataQuick attributed the decline in early
foreclosure filing to rising home values, an improving economy, and a shift
toward short sales which accounted for an estimated 26 percent of statewide
resale activity in the fourth quarter. The median price paid for a home during the quarter was
$300,000, up 22.4 percent from a year ago and 32.2 percent off the median's
$227,000 bottom in first-quarter 2009.

"Home
values increased through most of 2012, and the rate of increase picked up
toward the end of the year. That means fewer and fewer homeowners are
underwater, where they owe more than their homes are worth. That in turn means
they can sell and pay off the mortgage, or perhaps refinance at today's low
interest rates. This trend alone suggests we'll see a continued decline in
foreclosure rates this year. Another factor is the foreclosure-avoidance goals
of various settlements between lenders and the government," said John
Walsh, DataQuick president.

NoD
filings fell in all home price categories but default rates were higher in
California's most affordable neighborhoods. Zip codes where 2012 median sale prices in the
fourth quarter were below $200,000 collectively saw 5.5 notices filed for every
1,000 homes while the ratio was 3.5 NoDs per 1,000 homes in zip codes with
$200,000 to $800,000 medians and 1.3 per 1,000 where the median is above
$800,000. The same disparity was evident
with foreclosures which declined in frequency as the median price in the zip
code increased.

Foreclosure
resales accounted for 16.6 percent of all California resale activity last
quarter, down from 20.0 percent the prior quarter and 33.6 percent a year ago.
It peaked at 57.8 percent in the first quarter of 2009.

Most of
the loans going into default are still from the 2005-2007 period with the
median origination quarter being the third-quarter 2006. That has been the case
for three years, indicating that weak underwriting standards peaked then.

California has been among the hardest hit states in
terms of foreclosures, ranking in the top five in RealtyTrac's accounting of
foreclosure activity nationwide for most of the last six years. While
1.1 million of California's 8.7 million houses and condos have been involved in
a foreclosure proceeding the past five years, 780,000 were actually lost to
foreclosure. The other 320,000 were either sold, or the payments brought
current.

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